Every item and line item in the Ushuru API requires a tax type code (taxTyCd). This determines how VAT is calculated and reported to Kenya Revenue Authority.
Tax Type Codes
| Code | Name | Rate | Description | When to Use |
|---|---|---|---|---|
| A | Tax Exempt | 0% | Goods and services explicitly exempted from VAT under Kenyan tax law. | Unprocessed agricultural produce, educational materials, certain medical supplies. Confirm with your tax advisor. |
| B | Standard VAT | 16% | The standard VAT rate applied to most goods and services in Kenya. | All general commercial sales, software subscriptions, professional services, and goods not otherwise categorized. |
| C | Zero-Rated VAT | 0% | VAT-registered supplies taxed at 0%. Unlike exempt, the seller can claim input VAT credits. | Exported goods, certain foodstuffs, water, milk. The supply is taxable but the rate is 0%. |
| D | Non-VAT | N/A | Transactions by non-VAT-registered businesses or supplies outside the scope of VAT. | Only use if your business is not VAT-registered or the supply is explicitly out of scope. |
VAT Extraction Formula (Inclusive Pricing)
Most Kenyan businesses quote prices inclusive of VAT. Use the following formulas to extract the taxable amount and VAT from a VAT-inclusive price.
Type B (16% VAT), Inclusive Price Breakdown
Taxable Amount: totalAmount / 1.16
Example Calculations for Type B
| Total (incl. VAT) | Taxable Amount (excl. VAT) | VAT Amount (16%) |
|---|---|---|
| 1000 | 862.07 | 137.93 |
| 5000 | 4310.34 | 689.66 |
| 10000 | 8620.69 | 1379.31 |
| 50000 | 43103.45 | 6896.55 |
// Sale total: KES 5,000 (VAT inclusive, Type B)
const totalAmt = 5000;
const taxblAmt = parseFloat((totalAmt / 1.16).toFixed(2)); // 4310.34
const taxAmt = parseFloat((totalAmt - taxblAmt).toFixed(2)); // 689.66
// Verify: taxblAmt + taxAmt === totalAmt
// 4310.34 + 689.66 = 5000.00